As the digital transformation through e-commerce continues to revolutionize the business-to-customer, or B2C, transactional relationship—with one of the biggest players being Amazon.com Inc., who continues to bring waves of innovation—many traditional retail businesses are still figuring ways to catch up and compete. Toys “R” Us is just one example of a past retail giant that has now gone out of business, obsolete in the current market. All of this has indeed upturned everything anyone thought they knew about retail—and it’s forcing business-to-business (B2B) selling to follow suit in a similar manner.

“I call it destroying the retail orthodoxies,” said Sucharita Kodali (pictured), vice president and principal analyst at Forrester Research Inc. “Retail has historically been about buyers and merchandisers buying goods...And, unfortunately, the change for retailers is that consumers have so much more choice now. There’s so such more innovation…And this old paradigm of Mattel and Hasbro—or kind of fill in the blank with whatever vendors and suppliers—pushing things is no longer relevant.”

Unpacking the digital transformation of retail industry

Kodali unpacked the three biggest challenges the retail industry faces with the digital transformation into an e-commerce-driven industry. The first challenge is handling inventory across different retail channels. The second major challenge has been Amazon, a company that has reinvented retail as a business model. The third challenge is how brands are learning to sell directly to customers.

“[Amazon] single-handedly have transformed the retail industry; they have increased consumer expectations,” Kodali said. “And what Amazon’s also done is reinvented retail as a business model. Because it is no longer about just selling product and being profitable selling that product.”

A lot of the emerging e-commerce focus is in putting digital tools in place to help merchants be more flexible. “So, you want to flex to supply and demand, and some of that comes with integrating marketplaces into your own experience,” Kodali said.

Because B2C marketplace experiences are becoming so demanding, B2B marketplaces must follow suit because that’s what consumers expect, Kodali explained. Companies like Magento Inc. are stepping up to offer B2B eCommerce solutions through an open-source eCommerce platform written in PHP because there is a demand that will not be going away.

“That’s basically the cost of doing business at this point—is that you have to deliver all of the information that the customer wants and needs,” Kodali said. “And if you don’t, the customer is just going to opt to go purchase that product at whatever destination offers it.”

Watch the complete video interview below, and be sure to check out more of SiliconANGLE’s and theCUBE’s coverage of the Imagine 2018 event. (*Disclosure: TheCUBE is a paid media partner for the Imagine 2018. Neither Magento Inc., the event sponsor, nor other sponsors have editorial control over content on theCUBE or SiliconANGLE.)